Australia Unveils New Powers In Crackdown On “High-Risk” Crypto ATMs
Australia’s Minister for Home Affairs Tony Burke has unveiled new “powers” to crack down on crypto ATMs, calling them “high-risk” products linked to money laundering, scams, and child exploitation.
While addressing the National Club in Canberra today, Burke said that Australia’s financial crimes watchdog, AUSTRAC, has found that 85% of funds from top crypto ATM users were tied to scams.
“I want AUSTRAC to have the power to restrict, or if it decides, to prohibit high-risk products,” he said. ”Be in no doubt, crypto ATMs are a high-risk product.”
The plan, which still must pass parliament, would include giving extra powers to AUSTRAC to counter so-called ”mule accounts,” which are bank accounts that criminals take over from foreign students or visa holders.
Australia’s Crypto ATM Count Soars
AUSTRAC estimates that approximately 150,000 transactions per year are executed via crypto ATMs, and that approximately AUD 275 million ($179 million) is moved via these machines annually.
Burke’s new powers come amid a rapid growth in the number of crypto ATMs in Australia over the past few years. Since 2022, the number has experienced a 16-fold increase from just 73 ATMs to 1,200 by August 2024.
Crypto ATM growth in Australia (Source: CoinTime)
That number has continued to rise, and now stands at around 2,000, according to Burke.
He declined to specify whether AUSTRAC would ban the machines outright, saying that imposing such a ban could result in a “legal challenge.” Burke said, however, that not all crypto ATMs will be affected,
While the minister said that crypto ATMs are not “among the most prominent sources of financial crime risk,” he added that they still warrant attention. AUSTRAC is focused on “targeting criminal misuse rather than stifling innovation,” he said.
“The capacity for AUSTRAC to make a call on it will be given by legislation that I will introduce,” he added.
AUSTRAC Uncovers Hidden World Of Scams
Australia’s crackdown on crypto ATMs started gaining momentum in March this year when AUSTRAC placed crypto ATMs on notice after “worrying trends and indicators of suspicious activity” linked to the machines was uncovered by a task force in late 2023.
Last year, AUSTRAC started taking down crypto ATMs across Australia after the taskforce was established.
In another statement earlier this month, AUSTRAC said that it has uncovered “a hidden world of scams and dodgy dealings.” The taskforce added that their investigation showed crypto ATMs “pose serious risks for scams and money laundering.”
Australian banks have welcomed the government’s recent move. The Australian Banking Associations says that banning or tightening crypto regulation of crypto ATMs will have a substantial impact on criminals.
A Reuters report from the middle of the year revealed that many of the most active users of crypto ATMs were fraud victims themselves. In one instance, an elderly woman deposited over AUD 430,000 after falling victim to a romance/investment scam.
To address the high number of scam victims using ATMs, the agency has since implemented minimum standards for crypto ATM providers. This includes transaction caps of $5,000 alongside enhanced customer due diligence requirements across the crypto ATM sector.
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